Correlation Between TPL Insurance and Ghani Gases

Can any of the company-specific risk be diversified away by investing in both TPL Insurance and Ghani Gases at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining TPL Insurance and Ghani Gases into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TPL Insurance and Ghani Gases, you can compare the effects of market volatilities on TPL Insurance and Ghani Gases and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in TPL Insurance with a short position of Ghani Gases. Check out your portfolio center. Please also check ongoing floating volatility patterns of TPL Insurance and Ghani Gases.

Diversification Opportunities for TPL Insurance and Ghani Gases

0.0

Correlation Coefficient

TPL Insurance  Ghani Gases

Pay attention - limited upside

The 3 months correlation between TPL and Ghani is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TPL Insurance and Ghani Gases in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ghani Gases and TPL Insurance is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on TPL Insurance are associated (or correlated) with Ghani Gases. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ghani Gases has no effect on the direction of TPL Insurance i.e., TPL Insurance and Ghani Gases go up and down completely randomly.

Pair Corralation between TPL Insurance and Ghani Gases

If you would invest  0.00  in Ghani Gases on December 21, 2024 and sell it today you would earn a total of  0.00  from holding Ghani Gases or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

TPL Insurance  vs.  Ghani Gases

TPL Insurance

Risk-Adjusted Performance

Very Weak

Over the last 90 days TPL Insurance has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Ghani Gases

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ghani Gases has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Ghani Gases is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with TPL Insurance and Ghani Gases

The main advantage of trading using opposite TPL Insurance and Ghani Gases positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TPL Insurance position performs unexpectedly, Ghani Gases can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ghani Gases will offset losses from the drop in Ghani Gases' long position.

The idea behind TPL Insurance and Ghani Gases pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.